Bitcoin tax time? - Salon #bitcoin

Tthe U.S. Government Accountability Office’s new report on the tax implications of virtual currencies is definitely the GAO’s most cyberpunk moment to date. The report name-checks “World of Warcraft,” “Second Life” and, of course, Bitcoin. Yes, that’s right, the U.S. government is pondering how the IRS should deal with MMORGs (massively multiplayer online role-playing games). Don’t worry — if you’ve got piles of gold accumulating in your “WoW” account, you don’t need to declare it. Although, if you find a way to sell that gold to some other party in exchange for legal tender, that’s a different story. That’s income, and it’s probably taxable. But “WoW,” and “Second Life,” are sideshows. The specter of the IRS casting a shadow over Bitcoin, which the GAO concludes is “the most widely circulated virtual currency available,” is the meat of the report. Just the fact that the U...